Wesco International Inc (NYSE: WCC)

Sector: Industrials Industry: Industrial Distribution CIK: 0000929008
Market Cap 14.66 Bn
P/B 2.91
P/E 22.69
P/S 0.62
ROIC (Qtr) 7.90
Div Yield % 0.60
Rev 1y % (Qtr) 10.34
Total Debt (Qtr) 6.53 Bn
Debt/Equity (Qtr) 1.30
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About

Wesco International Inc., commonly recognized by its ticker symbol WCC, operates in the business-to-business distribution, logistics services, and supply chain solutions industry. The company boasts a global presence and diverse product and service offerings, organized into three strategic business units: Electrical & Electronic Solutions (EES), Communications & Security Solutions (CSS), and Utility & Broadband Solutions (UBS). Wesco's vision is to be the best tech-enabled supply chain solutions provider in the world. Wesco's main business activities...

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Investment thesis

Bull case

  • Healthy cash reserves of 604.80M provide 24.19x coverage of short-term debt 25M, demonstrating strong liquidity position and minimal refinancing risk.
  • Operating cash flow of 125M provides exceptional 54.35x coverage of minority interest expenses 2.30M, showing strong core operations.
  • Cash position of 604.80M provides exceptional 262.96x coverage of minority interest expenses 2.30M, indicating strong liquidity.
  • Tangible assets of 11.38B provide robust 9.17x coverage of other current liabilities 1.24B, indicating strong asset backing.
  • Cash reserves of 604.80M provide solid 0.91x coverage of other non-current liabilities 663.10M, indicating strong liquidity.

Bear case

  • Operating cash flow of 125M barely covers its investment activities of (140.70M), with a coverage ratio of -0.89, indicating heavy reliance on external financing for growth which may not be sustainable in a tighter credit environment.
  • With cash reserves of 604.80M against inventory of 4.01B, the 0.15 cash-to-inventory ratio suggests potential liquidity risks if inventory turnover slows, particularly concerning given current supply chain volatilities.
  • Operating cash flow of 125M provides thin coverage of dividend payments of (88.40M) with a -1.41 ratio, suggesting potential dividend sustainability issues if operational performance deteriorates.
  • Cash reserves of 604.80M provide limited coverage of acquisition spending of (36.10M), which is -16.75x, suggesting aggressive expansion might strain liquidity if market conditions deteriorate.
  • The company's operating cash flow of 125M shows concerning coverage of stock compensation expenses of 40.50M, with a 3.09 ratio indicating potential earnings quality issues.

Geographical Breakdown of Revenue (2025)

Segments Breakdown of Revenue (2025)

Peer comparison

Companies in the Industrial Distribution
S.No. Ticker Company Market Cap P/E P/S Total Debt (Qtr)
1 GWW W.W. Grainger, Inc. 79.03 Bn 100.02 8.17 2.72 Bn
2 FAST Fastenal Co 53.26 Bn 103.14 13.77 0.44 Bn
3 FERG Ferguson Enterprises Inc. /DE/ 51.30 Bn 26.23 1.65 6.02 Bn
4 WCC Wesco International Inc 14.66 Bn 22.69 0.62 6.53 Bn
5 WSO Watsco Inc 14.11 Bn 154.32 4.58 0.46 Bn
6 POOL Pool Corp 12.34 Bn 638.65 8.05 1.39 Bn
7 CNM Core & Main, Inc. 10.88 Bn 25.02 1.40 2.43 Bn
8 AIT Applied Industrial Technologies Inc 10.79 Bn 28.81 2.41 0.57 Bn

Industry comparisons

Current Valuation Value Ind Avg Percentile
EV to Assets EV to Assets 1.25 2.41
EV to Cash from Ops. EV/CFO 164.78 40.73
EV to Debt EV to Debt 3.15 16.40
EV to EBIT EV/EBIT 16.61 18.05
EV to EBITDA EV/EBITDA 14.10 36.64
EV to Free Cash Flow [EV/FCF] EV/FCF 817.36 77.53
EV to Market Cap EV to Market Cap 1.41 1.51
EV to Revenue EV/Rev 0.88 2.64
Price to Book Value [P/B] P/B 2.91 8.70
Price to Earnings [P/E] P/E 22.69 55.05
Dividend Metrics Value Ind Avg Percentile
Dividend Coverage Ratio Div Coverage (Qtr) 7.80 49.20
Dividend Payout Ratio % Div Payout % (Qtr) 13.70 22.67
Dividend per Basic Share Div per Share (Qtr) 1.82 1.88
FCF Dividend Payout Ratio % FCF Div Payout % (Qtr) 350.58 41.28
Interest Coverage Int. cover (Qtr) 3.21 35.27
Growth Metrics Value Ind Avg Percentile
Capex Growth (1y) % Capex 1y % (Qtr) -5.39 -47.49
Cash and Equivalents Growth (1y) % Cash & Equiv 1y % (Qtr) -13.92 77.69
Dividend Growth (1y) % Div 1y % (Qtr) 10.06 6.21
EBIAT Growth (1y) % EBIAT 1y % (Qtr) -6.37 -84.41
EBITDA Growth (1y) % EBITDA 1y % (Qtr) 2.84 -13.74
EBIT Growth (1y) % EBIT 1y % (Qtr) -5.62 -33.83
EBT Growth (1y) % EBT 1y % (Qtr) -10.07 -41.73
EPS Growth (1y) % EPS 1y % (Qtr) 0.00 -109.80
FCF Growth (1y) % FCF 1y % (Qtr) -97.50 -14.68
Gross Profit Growth (1y) % Gross Profit 1y % (Qtr) 5.50 1.31
Liquidity Ratios Value Ind Avg Percentile
Asset Utilization Ratio Asset Util Ratio (Qtr) 1.43 1.45
Cash Payout Ratio Cash Payout (Qtr) 0.38 0.20
Cash Ratio Cash Ratio (Qtr) 0.14 0.34
Current Ratio Curr Ratio (Qtr) 2.20 2.47
Debt to Equity Ratio Debt/Equity (Qtr) 1.30 0.88
Interest Cover Ratio Int Coverage (Qtr) 3.21 35.27
Times Interest Earned Times Interest Earned (Qtr) 3.21 35.27
Profitability Value Ind Avg Percentile
EBITDA Margin % EBITDA Margin % (Qtr) 6.20 7.33
EBIT Margin % EBIT Margin % (Qtr) 5.28 5.34
EBT Margin % EBT Margin % (Qtr) 3.63 4.29
Gross Margin % Gross Margin % (Qtr) 21.10 28.45
Net Profit Margin % Net Margin % (Qtr) 2.70 2.59